site.btaRound Table Discusses Problem with High Electricity, Gas Prices

Sofia, October 18 (BTA) - President Rumen Radev initiated Monday a round table to address the problem of high electricity and gas prices and prepare Bulgaria's position on the issue before the EU. At the meeting, he called against politicizing of the causes of the energy crisis.

An unprecedented energy crisis is swirling in Europe, and it does not pass Bulgaria by. The reasons are many, they are mostly global and domestic, the Head of State said. According to him, it is important what national decisions will be made so that the country softens the blow of this crisis. He added that the problem with the energy crisis is pan-European and Bulgaria expects and must work actively to seek pan-European solutions.

The discussion was held at the Boyana Residence and was attended by caretaker Prime Minister Stefan Yanev, Vice President Iliana Iotova, the caretaker Ministers of Energy, Economy, Labour and Social Policy, Energy and Water Regulatory Commission Chair Ivan Ivanov, as well as heads of energy companies, representatives of trade unions and businesses, mayors of municipalities.

Caretaker Prime Minister Stefan Yanev said during the discussion that a working group has been set up to prepare a new strategy in the entire energy sector. ''We will seek protection for Bulgarian businesses, protection of consumers who produce goods and services,'' he said.

Yanev pointed out that he does not want to enter into long-term solutions, because in this case short-term solutions are needed. He said that such would be adopted by the Council of Ministers on Wednesday.

Caretaker Energy Minister Andrey Zhivkov said that the caretaker government has already taken short-term measures to overcome the crisis related to the high prices of electricity for business and industry. According to the general opinion of the government and businesses, there are no long-term contracts and this is one of the reasons for the current price crisis.

Caretaker Economy Minister Daniela Vezieva said that from the reserve of the operational programmes under the scheme for support of small enterprises there are 60 million leva available for support of companies with a turnover of over half a million leva. Within a month, the companies will be able to receive the money.

The Chairman of the Management Board of the Bulgarian Industrial Capital Association (BICA), Vasil Velev, proposed on behalf of BICA a compensation for these 600,000 subscribers on the free electricity market for their large bills for July, August and September. The compensation would take effect from this month until the beginning of November.

Velev argued that the aid of 50 leva per megawatt-hour offered by the caretaker government is already extremely insufficient and explained that the aid was only sufficient for the month of July.

According to the caretaker Deputy Prime Minister and Minister of Labour and Social Policy, Galab Donev, it is imperative to reach a public consensus as soon as possible in defining energy poverty.

According to Donev, an analysis shows that the established mechanism for targeted energy support provides adequate social protection to the most vulnerable social groups, as the funds paid for the period from 2018 to 2021 are increasing.

Confederation of Independent Trade Unions in Bulgaria (CITUB) President Plamen Dimitrov said that CITUB wants the minimum wage to be 700 leva from November 1, 760 leva from January 1, 2022, and the poverty line to be 460 leva from December 1. He also called for a stronger position from Bulgaria regarding the Green Deal.

The President of the Bulgarian Chamber of Commerce and Industry (BCCI), Tsvetan Simeonov, asked whether the Ministry of Energy plans to start negotiations with Russia on natural gas prices and how the opportunities for the quantities of Azerbaijani gas that can be provided to this country will be used to reduce the prices of blue fuel.

The Chairman of the Bulgarian Gas Association, Plamen Pavlov, said the President needed to intervene in urgent negotiations with Gazprom to renegotiate the price formula. He also demanded intervention in negotiations with SOCAR to obtain the full amount of the agreed one billion cubic metres of gas, so that they can participate in the price mix.

Bulgarian Energy Holding (BEH) Executive Director Valentin Nikolov said TPP Maritza East 2 is expected to buy 6,000 tonnes of carbon dioxide by the end of the year. This means that BEH has to buy allowances for 763 million leva. If the price of carbon dioxide rises, then "things are going to quite different," Nikolov added. According to Nikolov, there is one tool that can be used without making legal changes. This is a consolidation of a bank loan from the Electricity System Security Fund.

Bulgargaz CEO Nikolay Pavlov said poor planning was the reason for the price increase. Many district heating and gas distribution companies have not planned their applications well. Pavlov appealed to all responsible authorities to check how the licensing obligations are fulfilled.

The Executive Director of the Independent Bulgarian Energy Exchange (IBEX), Konstantin Konstantinov, suggested paying more attention to the financial instruments offered for Bulgarian energy futures, which are the result of cooperation between the Bulgarian Stock Exchange and the German Stock Exchange. The second proposal is to organize tenders with long-term delivery.

The Chairman of the Energy and Water Regulatory Commission (EWRC) Ivan Ivanov said that the two main factors causing a sharp increase in the price of electricity are the high prices of natural gas and carbon dioxide emissions. If Russia increases natural gas supplies, it would naturally reduce its price in the coming months, Ivanov said. In addition, the supply of liquefied natural gas must be increased, he added. With regard to high carbon prices, "the key is in the hands of the EU" through the emissions trading platform.

The Chairman of the Management Board of the National Association of Municipalities in the Republic of Bulgaria (NAMRB), Daniel Panov, said that after the constitution of the parliament, the first bill to be adopted should be for the municipalities to have the right to participate in the regulated market. There must be a crisis headquarters that has a position on energy issues in the short term.

At the end of the round table, President Radev pointed out the consensus reached on the priorities - to ensure social tolerance for Bulgarian citizens, and to avoid risks for schools, hospitals, kindergartens, water companies, rail transport and businesses. With regard to the proposals of employers and trade unions presented at the discussion related to state support, Radev expects to clarify as soon as possible the mechanisms by which this should be done within the law. RY, DS/DT